A firm markets a product for $30 per unit that has a direct manufacturing cost of $15 per unit. Its contribution margin is:
A)50%.
B)33.33%.
C)$15.
D)None of the above

Question

Quizplus · Accepted Answer

Contribution margin is the difference between selling price and direct manufacturing cost. Here, contribution margin = $30 - $15 = $15. Contribution margin ratio = Contribution margin / Selling price = $15 / $30 = 50%.

A Firm Markets a Product for $30 Per Unit That